For those litigators who toil in the vineyards of pre-trial disputes over case management, and positioning issues for trial, a recent Chancery ruling is a useful tool that deserves a place in the litigator’s toolbox. The letter ruling captioned as In re Northwest Biotherapeutics, Inc. Stockholder Litigation, Cons. C.A. No. 2022-0193-JTL (Del. Ch. Feb. 14, 2025), refers to fundamental principles that govern all litigation and pre-trial proceedings in particular to ensure that litigation is guided by the most efficient procedures to present the issues in a manner than minimizes unnecessary delay and expense. This decision provides citations to authorities and learned commentary that provide guideposts and standards that can be applied in most every case.

Background

The context of this short letter ruling involved how to deal procedurally with the fact that a stockholders’ vote ratified challenged executive compensation after the court denied a motion to dismiss, but before any determination on the merits. Because of that somewhat unusual setting, the court considered several different options about the next steps it could take.

The court decided to allow the same type of limited discovery that might be available under Section 220 so as to put the plaintiffs in the same position they might be in if shareholder ratification occurred before the suit was filed.

Highlights

The decision offers gems of basic litigation and case management guidelines that I present in bullet point format:

• Court of Chancery Rule 1 instructs the members of the court that the rules: “Should be construed, administered, and employed by the Court and the parties to secure the just, speedy, and inexpensive determination of every proceeding.”
• Court of Chancery Rule 16(e) also contemplates that a court may: “Formulate and simplify the issues and . . . address such other matters as may aid in the disposition of the action.” The court quoted from an Advisory Committee Note to the analogous Federal Rule of Civil Procedure 16, as mentioned in the Wright and Miller treatise: “The timing of any attempt at issue formulation is a matter of judicial discretion.” Letter op at 3.
• After sorting out the procedural imbroglio, the court allowed the plaintiffs an opportunity to amend and supplement their complaint to address the ratification vote during the pendency of this case, and denied the pending motion for summary judgment without prejudice.